ECONOMY

HOW NORWAY BECOME RICH COUNTRY BY OVERCOMING POVERTY

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Introduction

Norwegian economic growth is really outstanding, first, the country was a very poor backwater then they happen a miracle in the North Sea, and start to chase their wildest dreams.  The journey to Norway is seriously noticeable, but also entirely untrue. The reality is that Norway was among the richer countries on the planet early on. No, Norway could not match American or British prosperity, but compared to the majority of countries in the world,

GDP Growth from 1820 to 1940

Let us compare Norwegian development relative to eastern European countries. Remember this was long before communism held back Eastern Europe, yet Norway has been ahead of most eastern European countries since the 1820s.  For southern Europe, the picture is a bit different. Keep in mind that Portugal and Spain had large colonial empires supplying them with sugar, spices, silver, and gold. It would have been strange if this did not give them any kind of economic advantage.

The Mystery of Norwegian Prosperity

– Norway is a pile of rock. Only around 2.7% of the land is suitable for agriculture, compared to around half of the area of the US. – The topsoil is thin. Travel around farm fields shortly after planting and it looks like they are growing rocks rather than vegetables.   – The jagged terrain of mountains and deep valleys means arable land is scattered around, making it hard to create large efficient farms. The average farm in the US is 9 times larger than a regular Norwegian farm. – North sea oil become extracted hugely and there is a  black gold rush that  ensued soon In less than a decade Norway that’s generating more oil than any other country on this planet, slowly the oil center become a Titan.

Why Was Norway Not As Backwards?

A related strategy was followed in Norway. Sheep, goats, and reindeer could utilize Norwegian vegetation. However, it was not enough for Norway to become some kind of cheese-exporting powerhouse like the Netherlands. Instead, there were three other activities that were key to Norwegian prosperity:  – Fishing  – Timber and lumber - Mining

Norway Profit More Than Others From Lumber Exports

Norwegian agriculture gave an advantage in timber transport. Timber could be moved down numerous rivers. In the end, one could build sawmills powered by water wheels that could turn the timber into lumber for export. The fjords gave access points to a lot of the interior of the country for ships. Thus a lot of Norwegian forests became accessible by water allowing highly efficient ship transport to send lumber cheaply to the Netherlands and Britain.  Thus, despite having vastly more forest, Russia could not compete. It did not have mountains that could help move the timber, nor fjords that would allow easy.

Hydropower Plants

Hydropower plants in Norway often got built through dugnad. The people in a community would contribute labor to help build a power station together with municipal and state investments. The idea was that by contributing, you and your town would benefit from getting electric power.